European Stocks Decline From Highest Level in Six Years

European stocks fell from a six-year
high as declines in banks including Credit Suisse Group AG
outweighed better-than-forecast data on U.S. home purchases.

Credit Suisse retreated 2.5 percent as a person familiar
with the matter said U.S. regulators are investigating its
accounting practices. Jeronimo Martins SGPS SA dropped 6.5
percent after reporting 2013 net income that missed predictions.
Anheuser-Busch InBev NV rose 2.8 percent after the brewer posted
earnings growth that exceeded estimates and predicted
improvements in its largest markets.

The Stoxx Europe 600 Index retreated 0.2 percent to 337.7
at the close of trading, paring earlier losses of as much as 0.6
percent. About two stocks fell for each that rose on the
benchmark measure. The equity gauge has advanced 4.7 percent
this month, on course for the largest monthly gain since July.
It declined 1.8 percent in January.

“There isn’t blind enthusiasm in the market like we had
last year, and investors know there won’t be easy wins,” said
Tobias Britsch, who helps oversee about $32 billion at Meriten
Investment Management GmbH, in Dusseldorf, Germany. “Valuations
are not cheap and there may be a little nervousness pushing
investors to be more conservative now. Improvements in economic
growth and an earnings rebound still need to be proven before
many are willing to pile in more aggressively.”

The number of shares changing hands in Stoxx 600-listed
companies was 13 percent lower than the 30-day average,
according to data compiled by Bloomberg.

Equity Valuations

The Stoxx 600 traded at 14.6 times its members’ projected
earnings, up from 13.7 times at the beginning of 2014, according
to data compiled by Bloomberg.

In the U.S., purchases of new homes unexpectedly climbed in
January to the highest level in more than five years, figures
from the Commerce Department showed today in Washington. Sales
increased 9.6 percent to a 468,000 annualized pace last month.
Economists had forecast a decline to 400,000.

Greece’s ASE Index rallied 3.3 percent to its highest level
since July 2011. The country’s borrowing costs dropped as
investors speculated that the Mediterranean nation will reach an
agreement with international creditors to ensure its banks’
financing needs are manageable.

Credit Suisse slid 2.5 percent to 27.50 Swiss francs. The
Securities and Exchange Commission is looking into whether the
lender improperly moved money in its private-banking unit to
conceal a drop in asset growth, the person said.

Barclays Plc, the U.K.’s second-biggest lender by assets,
declined 1.8 percent to 253.2 pence. A gauge of banking
companies fell for a second day on the Stoxx 600.

Jeronimo Martins

Jeronimo Martins slipped 6.5 percent to 12.17 euros, its
biggest drop since 2009. The Portuguese retailer that gets most
of its sales from Poland said net income rose 6 percent to 382
million euros ($524 million) in 2013. That missed the 386.8
million-euro average analyst projection compiled by Bloomberg.

Tesco Plc (TSCO) fell 2.7 percent to 326 pence as Oriel Securities
Ltd. cut its rating on the U.K.’s largest retailer to hold from
add. The brokerage said that Tesco failed to announce sufficient
changes at yesterday’s investor day to reverse declining same-store sales. Analysts at Deutsche Bank AG and Barclays said
Tesco’s promise of permanently cheaper prices will hurt its
profitability.

Lanxess AG retreated 2.7 percent to 53.37 euros. The
chemicals maker predicted it would report a net loss of 159
million euros for 2013 when it publishes final figures on March
20. The company took a charge of 257 million euros in the fourth
quarter of 2013 because it produced more goods than it could
sell and raw material and energy costs were high, according to a
statement.

Utilities Decline

RWE AG fell 4.2 percent to 29.07 euros. U.K. market
regulator Ofgem said energy suppliers will have to comply with
new rules from March 31, including having to publish prices at
which companies will trade wholesale power as many as two years
in advance. The German utility generated more than 18 percent of
its revenue in the U.K. in 2012, according to data compiled by
Bloomberg.

EON SE, which also has a U.K. operation, declined 2.9
percent to 13.73 euros. A gauge of utility stocks posted the
worst performance on the Stoxx 600.

Swiss Life Holding AG (SLHN) climbed 6 percent to 214.70 francs.
The country’s largest life insurer raised its payout by 22
percent to 5.50 francs a share. Bloomberg calculations had
projected no dividend change. Net income of 781 million francs
($878 million) for 2013 also exceeded analysts’ estimates as
premium income rose and costs declined.

Ferrovial SA (FER) added 3.2 percent to 15.47 euros, its highest
price since its October 2004 initial public offering, after
reporting 2013 net income rose to 727.2 million euros from 691.7
million a year earlier. That exceeded the 586.9 million euros
projected by analysts.